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A BILL TO BE ENTITLED
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AN ACT
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relating to interest on commercial loans. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 306.002, Finance Code, is amended by |
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adding Subsection (c) to read as follows: |
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(c) The provisions of this chapter providing authorizations |
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with respect to certain transactions do not affect or negatively |
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impact any rules of law applicable either to other transactions |
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subject to this chapter or to any transactions not subject to this |
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chapter. |
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SECTION 2. Section 306.003, Finance Code, is amended to |
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read as follows: |
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Sec. 306.003. COMPUTATION OF LOAN TERMS [TERM]. (a) In |
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addition to any other method otherwise permitted under this title, |
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a creditor and an obligor may agree to compute an annual interest |
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rate on a commercial loan on a 365/360 basis, determined by applying |
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the ratio of the percentage annual interest rate agreed to by the |
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parties over a year of 360 days, multiplied by the outstanding |
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principal balance, multiplied by the actual number of days the |
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principal balance is outstanding. A creditor and an obligor may |
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also agree to compute the term and rate of a commercial loan based |
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on a 360-day year consisting of 12 30-day months. Each interest |
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[For purposes of this chapter, each] rate ceiling under Chapters |
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302 and 303 expressed as a rate per year may mean a rate per year |
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computed in accordance with this section [consisting of 360 days
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and of 12 30-day months]. |
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(b) A creditor and an obligor may agree that one or more |
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payments of interest due or that are scheduled to be due with |
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respect to a commercial loan may be paid on a periodic basis when |
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due, but not more often than monthly, wholly or partly by adding to |
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the principal balance of the loan the amount of unpaid interest due |
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or scheduled to be due, regardless of whether the interest added to |
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the principal balance is evidenced by an existing or a separate |
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promissory note or other agreement. On and after the date an amount |
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of interest is added to the principal balance under this |
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subsection, that amount no longer constitutes interest, but instead |
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constitutes part of the principal for purposes of calculating the |
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maximum lawful rate or amount of interest on the loan. |
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SECTION 3. The changes in law made by this Act apply only to |
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a loan agreement entered into on or after the effective date of this |
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Act. A loan agreement entered into before the effective date of |
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this Act is governed by the law in effect on the date the agreement |
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was entered into, and the former law is continued in effect for that |
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purpose. |
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SECTION 4. This Act takes effect September 1, 2013. |